This week Our Week in Digital has trawled through the tech pages and brings you all the latest news from the exciting world of the tech and digital startups scene.  

This week it is the turn of our specialist recruiter, Yusuf to bring you the goings-on from this growing ecosystem.  He looks at the general trends in startups….with added focus on the emerging markets of Canada and India. He examines who has bought who, and what is being done by these savvy entrepreneurs in order to address one of the biggest pollutants on the globe!

Startups, Ignite Life, OWID, tech news, tech

Indian startups have raised a record $11.3 billion over 2019.

We still have two months to go until we are raising our glasses and welcoming in 2020. However, for the fast-growing Indian startup scene, 2019 has already been record-breaking! 

Indian startups are enjoying their best year yet, as a record amount of capital floods the ecosystem. 

The unlisted tech startups across the subcontinent have raised $11.3 billion so far this year. This figure is a substantial leap from last year’s $10.5 billion fundraise and a far cry from the darkened funding environment of 2016.

In 2016, Indian tech startups accumulated just $4.3 billion, a significant drop from the $7.9 billion raised the year before. Since that time though, things have brightened and the flow of capital has increased significantly. In 2017, Indian startups raised $10.4 billion.

This year’s raise has escalated the nation’s growing startup space and has only served to increase the space on its path of steady growth.  

Indian startups in numbers…

Looking at the numbers in a little more detail, Startups with consumer-facing offerings such as financial services have attracted most of the venture capital this year. These products have raised in the region of $8.2 billion. For example, the financial services firm Paytm has raised more than $2billion to date and has more than 200 million registered users in India.

Coming in second are retail startups. These growing businesses have bagged about $2.3 billion. Those which offer enterprise services raised $1.5 billion.  

Much of this change has been attributed to some significant governmental efforts. These efforts include the introduction of the GST taxation system for businesses and the introduction of UPI payments infrastructure. Not only this. Major Indian telecoms disruptor, Reliance Jio has arrived on the scene with incredibly low-cost data solutions. This alone has paved the way for tens of millions of Indians to come online for the first time. As a result, the market suddenly looks a lot more profitable.

2016 also saw a cash crunch, wherein we bore witness to the explosion in the demand for content and services that created a massive opportunity for local startups to innovate.

indian startups, india, tech, funding, ignite life, OWID

Employment Prospects

There is more welcome news from the Indian startup scene. Of the top 150 Indian startups that raised capital in the first half of this year, 17.3% of them were either led or co-led by women. This is a massive jump from last year when just 10% of startups counted women as their founder or co-founder.

Here at Ignite, we see many CVs from some very talented candidates who are based in or have studied in India. When further examining the research it seems that not only is funding amongst these disruptive startups blooming, they are also enjoying the prowess of a very talented workforce. In 2010, only 10% of founders of startups that had reached a Series A financing round had worked at a startup before. That figure went up to 36% in 2014 and ballooned to 70% last year.

Another interesting trend from the research highlights that investors are prizing quality over quantity. There has been a concentration of funds in a smaller number of startups. So far, tech startups in India have participated in 872 financing rounds, compared to 924 in 2018 and 1,141 in 2017.

This boost in interest amongst investors shows that the local ecosystem is maturing and as such has become braver in looking to tackle a wide range of products not attempted in other markets. Industry analysts have noted that in 2014 and 2015 when interest waned, these startups were largely focused on building e-commerce solutions and attempting to replicate ideas that worked in Western markets.

This is great news from the emerging market and it is great to see that technological infrastructure is facilitating these patterns of growth.  

Luge Capital raises $85m to invest in Canadian startups.

Currently, there are 831 fintech startups either headquartered in or operating from Canada. However, only a handful of venture capital funds are specialising across this region and sector.

One particular capital fund is looking to close that gap. Luge Capital is a fintech and AI focussed venture capital fund headquartered in Montreal and Toronto.  

This week it has been reported that Luge Capital has raised $85m for its initial fund. With it, they plan to make seed investments ranging in value between $150,000 and $2million.

Founded in 2018, Luge Capital are relative new-comers to the market. They are led by David Nault and Karim Gillani who have both held board level positions. The former at iNovia Capital and the latter at Xoom, the Paypal acquired remittances startup.  

Luge Capital are backed by some big names; iA Financial Group, BDC Capital, Caisse de dépôt et placement du Québec, Desjardins Group, La Capitale, Sun Life Financial and Fonds de solidarité FTQ.  

Somewhat unusually though, some of the limited partners approached Nault and Gillani. They said that if they raised a fund, they would finance it. Fortune favours the brave, as they say. The pair left their jobs to raise a debut vehicle to support fintech companies in Canada’s blossoming tech scene.

Gillani has reported that he has seen a rise in the numbers of fintech companies. He attributes this to the improved access to capital. Companies who once may have struggled to secure funding are now receiving support and as such are more “on the radar” as attractive propositions. There’s a bigger appetite for larger companies to partner with these startups.

fintech, finance, technology, app, ignite, digital, talent, tech, OWID

Luge Capital Investments

To date, Luge Capital has made 5 investments. Three of which, Luge have not made public. However, they have not been quite so shy regarding the remaining two.

Luge has provided cheques to Flinks, which helps businesses connect apps and users’ bank accounts. In addition to this, they have invested in Owl; a provider of a service that supports financial institutions with customer onboarding, fraud detection and more.

 Gillani predicts that we shall see more growth in venture in Canada. He expects that founders will have more “rest of the world” aspirations for their products. Indeed, they will see Canada as an initial market but will plan to evolve and adopt a much more global mindset. Once they prove the model on home soil, they will switch their focus to expand geographically.   

$3 billion has been invested in Canadian startups so far this year; a record figure. Gillani believes that due to the more ambitious mindset of the entrepreneurs behind these firms, this is a figure that will rise. Indeed, this dynamic will encourage a rise in more and more outside capital to finance these founders.

Electric Vehicle Charging Software EV connect raises $12m.

Los Angeles based EV Connect is a startup that sells software to manage electric vehicle charging. This week, EV Connect has announced it has raised $12m in a Series B funding round. The round was led by investors Mitsui & Co. and Ecosystem Integrity Fund.

To date, the company has raised $25million.

EV Connect has a two-tiered approach. The company provides and manages 1,000 electric vehicle charging sites through its EV Connect network. EV Connect also provides a smartphone app through which drivers of electric vehicles can be given real-time access to charging station status.

Additionally, it also sells a cloud-based software platform that businesses can customise.

The cloud-based platform has an open standard architecture that is designed to be hardware agnostic. In sum, EV Connect aims to provide a variety of hardware vendors a way to monitor, manage and maintain charging stations.

EV, startups, electric vehicle, eco, environment, EV, Ignite life, OWID

Where do they plan to go in the future?

According to EV Connect CEO and founder Jordan Ramer, the ultimate aim is to push the industry away from a closed and fragmented system to a more open one.

As part of the round, Mitsui and EV Connect have agreed to develop new business models challenging EV charging infrastructure. EV Connect plans to work with Mitsui on various applications of EV charging. They hope this will lower the cost of charging and maximise its utilisation. Currently, they are both challenging issues for fleet customers and their energy management solutions.

This investment is one that is likely to bear fruit for the Electric Vehicle space. The combined weight of the two units will only contribute to the discussion surrounding the issues which are affecting the widespread use of electric vehicles today; namely cost and usability.

Kazumasa Nakai, the COO of Mitsui’s infrastructure projects business unit has remarked that; 

“Our unique engineering capabilities, in conjunction with EV Connect’s cloud-based EV infrastructure, will enable us to develop new business models to solve the challenges EV infrastructure currently pose for energy management companies.”

Squarespace acquires social media authoring startup, Unfold.

The past couple of years has witnessed an expansion of Squarespace’s portfolio. Squarespace has become more than just a website building platform. Squarespace has diversified and has become a more mature offering. It now offers email marketing and online appointment management. 

This week, it is reported that the firm is now dipping its digital toe into the world of social media content creation. Squarespace has announced that it has acquired Unfold. Unfold is a startup that offers templates for creating stories on Instagram, Facebook and Snapchat. It could be argued that this model sits very well alongside Squarespace’s current product….A Squarespace style approach to social media, if you will!

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Squarespace CEO Anthony Casalena has remarked that they are in pursuit of becoming the all-in-one platform for any business or brand that wishes to stand out.

“Whether building a business or personal brand, social media is a place where many creators get started before launching a website. As a first in our category, we’re excited to provide our customers with a way to stand out no matter how they are getting started.”

Although the financial terms of the acquisition were not disclosed, Squarespace did confirm that not only is their product growing, so too are the numbers around the table. Unfold co-founders Alfonso Cobo and Andy McCune will be joining the company.

We hope you enjoyed this week’s news from the world of startups. The international startups scene is exciting and ever-expanding.

We would love to hear what you think, leave us a comment below!

About the author: I aspire to help clients connect the dots by offering an extensive and honest experience. I am passionate about digital and in prior roles have assisted C level executives to overcome the challenges posed by a fast-moving, disruptive business environment – I believe that people and not solely technology is imperative in instilling forward-thinking, sustainable business development.

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